One of the most basic elements of the claims process is that ofnegotiation. So why is it that so many in claims organizationsstruggle with effective negotiations? Part of the problem isthat the role of adjusters has evolved over the years. Priorto the advent of technology, adjusters primarily spent their timewith boots on the ground.

Whether it was writing an appraisal, canvassing a neighborhoodand sitting face to face with an attorney, opportunities to honecritical skills were never lacking. This was particularly truewith negotiations, which were frequently done in person rather thanover the phone.

In recent years, the claims process has transformed to one oftenconducted inside. Certainly, technology has been leveraged forthe benefit of staffing and production, but has it denigratedquality? Is it possible to negotiate as effectively with anattorney, claimant, or body shop over the phone versus inperson?

While effective negotiations can be conducted in any forum, itis crucial that those conducting them have the fundamental skillsnecessary to achieve accurate outcomes. In some respect,negotiating over the phone can be less intimidating. It canalso lead to complacency, however, where negotiations succumb toother competing priorities such as disposition. The fight over“repair versus replace” may take the back seat to getting the claimclose, especially if the inside adjuster didn't write the estimateto begin with.

An Aging Adjusting Population

Organizations find themselves challenged on a number of fronts.Let's face it, the adjusting population is aging. Many folkswho began their careers negotiating in body shops or law firms nowfind themselves overseeing claims processes with different dynamicsand demands. Others, arguably more fortunate, find themselvesgolfing or playing shuffleboard in a retirement community in BocaRaton or Belize. Complicating matters is the lack of newcomersinto claims organizations. Think about how many youngstersreally say, “When I grow up I want to be a claims adjuster!”

While some of the slack can be picked up by leveragingtechnology, the reality is there is no substitute for someonedigging into that BI demand. Think of the benefits of skilledinvestigators scrutinizing the facts, refuting excessive medicalcharges, arguing comparative negligence and negotiating a realisticsettlement for that $100,000 policy limit demand for claimant withthe garden variety soft tissue injury and a history of priorclaims.

This is a challenge in a world where negotiation skills havefallen down the list of priorities. A simple benchmark in manyorganizations is to simply look at the percentage of claims settledwith comparative negligence. This is one of the mostfundamental blocking and tackling skills in the world of claimsadjudication. A far more common outcome are claims beingsettled at zero or 100 percent, even in situations involvingpremises, parking lots, lane changes or intersections. How isthis so when juries assess shared fault in similar situationsnearly 50 percent of the time?

Simply stated, some have taken their eye off theball. Basic fundamental skills have taken a backseat to otherpriorities, such as claims disposition. Don't get me wrong,closing claims is important. But doing so with accurateoutcomes is even more important as it impacts not only thoseinvolved in the claims, but all policyholders and the public ingeneral.

Savvy Negotiation

So where does one start in developing these negotiationskills? Arguably it begins with the hiring process, where theinsatiably curious are identified. Like any skill, noteveryone has the same ability to skillfully influenceoutcomes. Some negotiators are amazing, some average and somejust aren't cut out for a career negotiating claims. Some havethe ability to role play for hours on end; others are paralyzedwith stage fright in such a setting. It's not a knock againstanyone, but rather a reality check to make sure that those buildingthe foundation of success start with hiring the right people forthe job.

Of course, not everyone is building an organization from theground up. The good news is that existing skills can beimproved upon. It just takes a conscientious effort todevelop a plan that consists of initial training and ongoingsupport. In many instances, some who may not have the knackof Perry Mason, can be given tools to improveskills.

During my tenure implementing solutions for a largemultinational insurer, we leveraged such tools to assist theadjusters to more effectively investigate, evaluate and negotiateliability and damages for claims. By providing them with theroadmap to success, they develop critical investigation andnegotiation skills resulting in improved outcomes.

Such workflow solutions succeed because they tie into behaviormodeling and modification. By replicating the thoughtprocess and behavioral patterns of your top tier of adjusters, youcan transform an entire organization.

At the end of the day, we achieved results by focusing on properexecution of basic fundamental skills. This is the key tosuccess in any organization, regardless of industry. By gettingback to the basics, it becomes possible to very easily move anorganization from ordinary to extraordinary. Even better, onceyou are there, it becomes impossible to look back.